Photo: Ratan Tata

With markets and markets watchers all agog in anticipation to see who Ratan Tata’s heir will be, the man himself refuses to be drawn into making it a big deal. In a TV news report, Tata reiterated that all the speculation was quite needless. He spoke on the succession plan that was put in place, that the selection committee had been formed ten years ago and that certain parameters in the selection criteria were set by him.

The final decision on the successor will be taken by the committee, which he will be totally uninvolved in, said Ratan Tata. Tata Sons will only be carrying out the task of announcing the name of the person that the committee picks out as the successor.

He made it clear that regional or community politics would not have any role in the selection process. Basically, the chosen person would be one who displayed all the capabilities that were required to take the company forward on the same levels of excellence and accomplishment that was its hallmark. He has made it clear that he would be open to someone outside the group taking over as well, if he was considered to be the perfect candidate.

According to reports, Ratan Tata’s successor will be named by March 2011. The group had its beginnings in 1887, with four partners. Ratan Tata will retire as the sixth Chairman of the Tata Group on December 29, 2012. One of the candidates rumored to be a hot favourite is Noel Tata, who has been in Nestle, Tata International, Lakme and Tomco in the past, and served as managing director of Trent, where he is still Vice-Chairman.

Photo: Tata Swach

The Tata Group has launched what could probably be the cheapest water purifier in the world.

The new water purifier, called Swach, is a part of the Tata Group’s efforts to check the increasing water-related diseases in India, according to Ratan Tata, chairman of the Tata Group.

Swach (which means ‘clean’ in Hindi) has been developed jointly by the Tata Group’s companies Tata Chemicals, Titan, and TCS.

Swach has two variants – with retail prices of Rs 749 and Rs 999, respectively.

“Our quest is not to create the cheapest products,” Ratan Tata, 71, said at the launch of Swach. Instead, the Tata Group focuses on “accessing the largest number of people” and “that is what drove our efforts on the Nano car, on the low-cost housing project, and that is what is driving our water purifier, too,” he declared.

By the end of 2009, Swach will be ready for sale in 3 states – Karnataka, Maharashtra and West Bengal.

Swach will be available all over India by June 2010.  Considering the low price of Swach, many are already calling it the Tata Nano of water purifiers.

The Tata Group already has set up a plant in Haldia, in West Bengal, with a capacity of 1 million units of Swach. This capacity will be increased by another 1 million units within 3 months.

According to the Tata Group, the water purifier will make available pure drinking water to a 5-member family for as little as Rs 30 a month.

For the sale of the low-cost Swach, the Tata group will use its network of companies like Rallis and the Tata Kisan Sansar, a rural-centric resource centre.

Ratan Tata said the distribution network of Tata Salt will be used to distribute Swach, along with non-governmental organizations (NGOs) and local self-help groups.

The Swach water purifier is based on a concept developed by the TCS Innovation Labs – the Tata Research Development and Design Centre (TRDDC).

The device is built around a bulb-like water purifier component made of natural elements, such as rice-husk ash, filled with nano-silver particles. It can function without electric power or running water.

The cartridge bulb of Swach has a purification medium which kills bacteria and other organisms that cause diseases.

Swach can purify up to 3,000 litres of water, after which the cartridge stops flow of water.

The Tata Group said it has filed 15 patents for its novel water-purifying technology and the product.

According to R Mukundan, managing director of Tata Chemicals, water-borne disease is the single biggest threat to global health. Diseases such as jaundice, cholera, diarrhoea, polio, gastroenteritis and typhoid are spread through contaminated water.

At the launch of the Swach, Mukundan citied a report of the United Nations published in 2007 to stress that half of hospital-beds in the world are occupied by patients afflicted with water-borne diseases.

In India, water-borne diseases cause more than 1.5 times the deaths caused by AIDS, and double the deaths caused by road accidents, R Mukundan said.

The $71-billion Tata Group, one of the oldest business families in India, has been actively involved with several mass-utility projects as well as innovative products, including the supercomputer Eka.

Earlier in 2009, the Tata Group had launched the ‘Nano’ car, at a basic price of Rs 100,000, described as the cheapest car in the world.

Photo: Ratan Tata

Ratan Tata, 71, told the newspaper in an interview that the possibility of a non-Indian taking over the entire Tata group cannot be ruled out.

According to the WSJ interview, Ratan Tata said 65% of the group’s revenues come from overseas sources.

Considering that fact, an expat taking over the Tata Group is not unthinkable, said Tata. Tata also said that things would have been easier if his successor was an Indian, as Tata is an Indian brand.

Ratan Tata, the man who currently leads the conglomerate, is due to retire in 2012. Tata wants to name a worthy successor to his throne before he retires.

Tata confirmed in the WSJ interview that they have already started searching for a suitable successor, and are looking for candidates from both inside and outside the company.

Ratan Tata had repeatedly said in the past that he would want to see a much younger face lead the group, and that he or she should be ideally in his or hers 40s.

Ratan Tata has also said in the past that he/she should get at least 18 months to two years as the designated successor before taking over the reins of the group. Earlier, possible contenders for the throne of Tata Group were considered to be Keki Dadiseth, Noel Tata, and Cyrus Mistry.

However, with Ratan Tata’s new interview with WSJ, it seems that the race is still very much on and other names apart from those mentioned could yet surface.

The Tata Group, which was set up in 1868, has annual revenues of USD 71billion and employees 37,000 workers. Though the Tata Group has always been a

Tata-company, it has once been led by someone outside the Tata family. Sir Nowroji Saklatvala started with the group as a clerk in 1899 and ended up heading the Tata Group.

The single larget stakeholder in Tata Sons, which is Tata Group’s holding company, is Pallonji Shapoorji Mistry. Mistry has an 18% stake in the company and is now settled in Ireland. His son, Cyrus Mistry, is on the board of directors of Tata Sons.

According to Ratan Tata, chairman of Tata Sons, the company will set up similar housing projects in other centres in India such as Bangalore, Kolkata, and Assam.  Read more about the Tata Shubh Griha low cost housing project in this story.

The company’s affordable housing project launched in Boisar has attracted interest from all parts of the country, Ratan Tata said in Munnar in Kerala. He was in Munnar to attend the silver jubilee celebrations of the High Range School in Munnar, run by the Tata Group.

The Tata Housing Development Company Limited, which started the ‘Shubh Griha’ project in Boisar, near Mumbai, is offering what the company calls ‘Smart, Value Homes’ to people across India, to start with.

The Tata Group, the first corporate entity to have entered the low-cost housing sector, says it will spread its presence across India – in Tier I cities and Tier II cities.

The ‘Smart, Value Homes’ from ‘Shubh Griha’ in Boisar are priced between Rs 3.9 lakh and Rs 6.7 lakh.

Ratan Tata said that Maldives has expressed interest in the company’s housing project and has invited the Tata Group to introduce the concept in Maldives.

According to him, the consumption of steel in developed countries such as Europe and the United States is expected to reach the pre-recession levels in the next 2 years. The good news at present, he added, is that the market has stabilized, with no sudden drop or cancellation of orders.

Ratan Tata said that a team from Land Rover and Jaguar had visited India in search of components they can source from the country. So far, no decision has been taken on this.

Tata Motors, he disclosed, is planning to adapt the Nano car for the European market. However, it will take at least 2 years for the company to meet all regulatory requirements before the launch in Europe.

The new high-speed, high-horse-power truck that Tata Motors has launched will be marketed worldwide – among the countries would be Malaysia, Indonesia, South Africa, as well as the countries in the Middle East. At present, these trucks are exported to South Korea, according to Ratan Tata.

When asked whether the Tata Group will cut the salaries of its top executives, Ratan Tata said the Group has already taken steps to cut costs as well as avoid wastage.